United States policy toward the Andean region, which has focused predominantly on curbing drug cultivation and trafficking, has been ineffective. Rather than reduce drug trafficking and cultivation, the policy merely shifted it to other areas around the region, and Colombia's drug traffickers have forged cooperative relationships with guerrillas and paramilitary groups. Worse, revenue from drug trafficking is financing international terrorism.

Unless a new strategy toward this region is developed, the weaknesses of past U.S. policy will undermine efforts to help the region become economically and politically more stable. Specifically:

• The Andean countries should not be treated as a unit. Colombia's drug and terrorism problems have grown, spilling into neighboring countries and fueling criminal activities throughout the hemisphere. In contrast, Bolivia and Peru successfully targeted the cultivation of coca, and Peru was successful in defeating the guerrillas in its territory. Meanwhile, Ecuador, primarily a drug transit country, saw progress in stopping drug trafficking. Such differences among the Andean countries call for a strategy that addresses each Andean nation on its own needs and merits.
• Colombia's peace process has failed despite U.S. support. The Bush Administration inherited policies that encouraged Colombia to appease the guerrillas and make concessions, such as granting a Switzerland-sized sanctuary to the Revolutionary Armed Forces of Colombia (FARC)--the most powerful guerrilla group in Colombia, which the Bush Administration has listed as a terrorist organization. The appeasement strategy merely encouraged the FARC and other armed groups to continue brutalizing the population and cooperating with drug traffickers. President Andrés Pastrana of Colombia recently announced an end to the peace dialogue with Colombia's leftist guerrillas and ordered them out of their haven because of their ongoing attacks on the people, government, and infrastructure of that country.
• U.S. policy should not restrict trade and economic development. The centerpiece of America's economic development strategy for the region is the Andean Trade Preference Act (ATPA), which seeks to strengthen legitimate sectors of the Andean economies by creating viable alternatives to the drug trade. Unfortunately, ATPA has not achieved its goal because of the limited nature of its trade concessions. A comprehensive free trade agreement would be more effective in promoting economic development.

A New U.S.-Andean Strategy.
The Bush Administration should recognize these weaknesses in past U.S. policies toward the Andean countries and establish a new long-term strategy that looks beyond halfway measures and conditional access to the U.S. market. The Administration should:

• Treat Colombia's drug and guerrilla problems as a security issue that is fundamentally different from the problems in other Andean nations. Colombia's drug problem is no longer just a development and drug eradication issue; it has grown into a security threat and should be addressed as such. Bolivia, Ecuador, and Peru took strong steps to eradicate drug-related trade and cultivation or guerrilla activity. They should be encouraged to continue to exercise fiscal restraint, liberalize their economies, privatize state enterprises, control inflation, eliminate corruption, and strengthen the rule of law.
• Support Colombia's fight against the guerrillas, paramilitary groups, and drug traffickers. The growing power of guerrilla groups in Colombia poses a threat to the Colombian government and to regional security. The Administration should support the Colombian government's rejection of appeasement measures, offering security assistance as well as training and equipment to help it defeat the combined problems of guerrilla violence and drug trafficking. The Administration should also dedicate security assistance and equipment to Colombia's neighbors to deal with problems that spill across Colombia's border.
• Provide the basis for prosperity by offering a free trade agreement. ATPA is a limited trade agreement. The United States should go beyond its trade preferences and transform it into a free trade agreement with Bolivia, Ecuador, and Peru to enable them to export more of the products for which they have a competitive advantage. Signing a free trade agreement with the United States would motivate these countries to sustain their efforts to eradicate drug trafficking and defeat the guerrillas. Once the Colombian government has demonstrated its commitment to these goals as well, the United States should integrate it into the broader economic agenda and the free trade agreement.

Conclusion.
The United States must revise its Andean policy to help the nations of that region achieve political and economic stability. Guerrilla terrorism and illegal drug cultivation now threaten the entire region and American interests. Eradicating them must be a priority, but Colombia's problem must be treated as a separate security issue. Bolivia, Ecuador, and Peru should be encouraged to continue liberalizing their economies and strengthening the rule of law, and ATPA should be transformed into a full free trade agreement with Bolivia, Ecuador, and Peru, with Colombia joining as it demonstrates its commitment to market liberalization, eradicating drug trafficking, and defeating the guerrillas.

Ana I. Eiras is Economic Policy Analyst for Latin America in the Center for International Trade and Economics; John C. Hulsman, Ph.D., is Research Fellow for European Affairs, and Stephen Johnson is Policy Analyst for Latin America, in the Kathryn and Shelby Cullom Davis Institute for International Studies; and Brett D. Schaefer is Jay Kingham Fellow in International Regulatory Affairs in the Center for International Trade and Economics at The Heritage Foundation. Research Assistants Anthony Kim, Carrie Satterlee, and Kimberly Thompson also contributed to this paper.